Dennis Prahl is both a partner in the well-known intellectual property firm of Ladas & Parry LLP, where he addresses trademark, copyright, and domain name issues as outside counsel to numerous major multi-national companies, and the President of Principium Strategies, one of very few companies that monitors threats to brands arising from efforts to register and/or use similar brands by competitors and third parties throughout the world. These related but divergent roles uniquely position Mr. Prahl to consider the most recent and greatest threats to global brand owners.

How have the challenges facing global brand owners and their outside counsel changed?

Brand threats are nothing new, but their increasingly complex nature and sophistication have resulted in the need for significantly greater vigilance at a time when companies have fewer resources to devote to them. Recently, we are seeing three greater challenges: (1) a growing difficulty in enforcing against third party adoption of similar trademarks in domain names, which often serve as the host for counterfeit websites and facilitate phishing schemes; (2) a tidal wave of bad faith trademark applications in China and around the world; and (3) the migration of online counterfeiting from websites and sales platforms to social media outlets.

Why is domain name enforcement any more difficult today than previously?

In the past two years we have seen an increasing use of domain names containing trademarks and variations being registered for use in phishing schemes, namely domains used in email addresses to fool both brand owner employees and their customers into accessing a link or opening an attachment, leading to the introduction of malware and spyware to the network, or visiting a fake website and entering user names, passwords, or other confidential and personal information. We have worked very closely with our clients, many of whom are in sensitive industries, to partner with their IT, security and legal teams to ensure we promptly detect these threats through our domain monitoring service, block them from internal users and take them down as soon as possible to mitigate any damage.

Coupled with the rise in the need for domain name enforcement is the paucity of information about the party that registered a particular domain. Among the numerous issues caused when the European Union’s General Data Protection Regulation went into effect on May 25, 2018, most of the identifying data of who has registered these bad faith domains and how to contact them has ceased to be available. Consequently, we are unable to see patterns of bad faith activity and the take down process has become more complicated than before. However, we are using other tools to cope with the missing data in order to attack these domains as swiftly as possible.

What do you see as the growing threat from China?

Last year the Chinese government lowered the filing fee for Chinese trademark applications. As a result we have seen a spike of hundreds of thousands of trademark applications being filed, many in bad faith to take advantage of well-known brands but also of lesser known brands. Moreover, government subsidies in many Chinese provinces have encouraged these applicants to seek trademark registrations in other jurisdictions. The United States Trademark Office has been coping with a spike in U.S. trademark applications by Chinese applicants, a proportion of which have utilized digitally modified use evidence that the trademark examining attorney may not readily notice. We have encouraged our clients who embark on any new branding strategy to add China to the top of their list, even if the prospect of commercializing the brand is years away, to mitigate such activity. For those who are not so lucky, we are using creative strategies to act against these bad faith filings.

How has online counterfeiting changed?

Traditional online counterfeiting activity has been in the realm of fake websites and online selling platforms, but the more recent trend is the promotion and sale of counterfeit goods through social media sites such as Facebook, Twitter, and WeChat, some of which allow transactions to occur from within the platform. The result is that the shipments to consumers are now in smaller quantities making detection and enforcement more challenging. We have worked with our clients to devise more strategic brand monitoring in the social media platforms to detect such activities and address them on the enforcement side, while also coordinating more with local customs officials to detect the actual shipments as they are coming through ports of entry.

How can brand owners and their counsel efficiently address all of these problems when they are already spread so thin?

Brand owners have limited budgets to obtain and enforce brands so it is vital that they create proactive registration policies and enforcement strategies, identifying what is most important to the brand and what resources should be applied to each threat level. It is also essential to partner with brand monitoring services to filter noise, better vet identified threats and focus on the more significant issues to address according to each tailored policy. As an IP practitioner and also president of a brand monitoring company, I have had the pleasure of being able to combine both sides of the business to benefit our clients in this process and give them the advantage in enforcing their rights.

This interview was originally published on the Leaders League website on June 13, 2018